January 31, 2009
Roche's "Hostile" Bid for Genentech
Roche has announced a "hostile" bid for Genentech at $86.50 a share. Sounds simple enough. It's not. Roche already owns 54 percent of the stock. It is making a hostile bid for the remaining shares in a company it already controls. A special negotiating committee of the Genentech board had rejected the Roche offer of $89 a share. The bid comes in a falling market, with financing very difficult to secure, on the eve of a drug approval, and for a company that has most of its value in employee knowhow. Very risky stuff. Roche will hope to close a negotiated offer with the new pressure and then defend in court the value paid. Keep in mind that much of this is to convince a judge that the price paid for a minority shares is "intrinsically fair."
January 31, 2009 | Permalink
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